Why You Should Stop Hankering After Your Own Web Store

“I just need to get selling on my own website – there’s no eBay fees, no feedback system – I’ll save so much I could even set my prices lower to bring the buyers in!”

Have you ever thought that? Or heard other sellers say it? I’ve heard it many times, and don’t question that there are advantages to having your own independent web store.

But there are many differences between selling on the marketplaces, and selling through your own store. The marketplaces have the advantage in almost all of them. In this post I’ll explain why most sellers should concentrate their efforts on the marketplaces, and tell you about the few cases where it still makes sense to go it alone.

Only selling on marketplaces?

Fees are up, standards are harsh and change is constant. Get control back with your own independent web store, or use automated tools to connect with millions of buyers on social media. All in the Web Retailer directory.

Buyers Don’t Buy at Random

Nearly twenty-five years ago, at the age of sixteen, I started a business selling software. It was public domain software, so free to copy and distribute. This was many years before widespread internet use, so a mail-order software “library” was a useful service to provide.

Now, this wasn’t an original business idea – there were several public domain software libraries already advertising in the popular computer magazines. I just thought I would do the same, and get a small share of the market.

I had some money to invest, but not a lot, so took out a small ad in the computing press. I got a few orders, but nowhere near enough to pay for the ads. I thought I might need to build some buyer recognition – to show that my business wasn’t going away any time soon – so carried on advertising. The orders continued at a trickle, and I swiftly spent all my money on ads. The business had failed, quickly.

What went wrong? I’d figured out that I only needed to get a very small fraction of magazine readers to buy from me, so why couldn’t I get even that tiny slice? The lesson I learned was this: buyers don’t buy at random. There’s always a reason why they buy where they do, and I hadn’t created a compelling reason for them to buy from me instead of someone else.

Why Buyers Buy From Marketplaces

What’s all that got to do with selling online in the twenty-first century? Well, while technology has changed a great deal, buyer psychology has not. Buyers still need to be compelled to buy, and the marketplaces do a fantastic job of it.

Marketing

eBay and Amazon are household names, but they haven’t been around all that long – it took a lot of effort and expense for them to get where they are. And they continue to work hard to bring potential buyers to their sites with advertising, search engine marketing, social media, affiliate programs, loyalty programs and much more.

Buyers buy from marketplaces because they know they exist, and there are many different routes that bring them to their sites.

Trust

When a buyer is browsing on a marketplace, they might see products from dozens, hundreds, or even thousands of different sellers. But the buyer doesn’t see it that way.

They just see it as buying “off eBay” or “from Amazon”. Do you often hear someone saying “I bought this off SellerXYZCo789 on eBay”? I doubt it. The particular seller they buy from is of little interest, as long as they satisfy a basic minimum standard in the buyer’s mind.

After all this talk of compelling reasons to buy, why don’t eBay and Amazon buyers care who they buy from? Don’t they need to be “compelled” any more? Actually, they need compelling reasons more than ever, but it’s not the individual sellers providing many of them – it’s the marketplaces themselves.

Buyers trust eBay and Amazon, even though they buy from third-party sellers, because:

They trust the marketplace to assess sellers and throw out the bad ones.

They trust the marketplace to put things right if they do go wrong.

And that’s exactly what the marketplaces do. The way marketplaces assess seller performance is sophisticated and comprehensive, and was covered in detail in Feedback & Reputation: The Ultimate Guide. If sellers don’t provide a good enough service, they drop down in the search results, have limits imposed, or get banned completely.

The marketplaces have strong buyer protection programs in the form of the eBay Money Back Guarantee and Amazon’s A-to-z Guarantee. When there’s a dispute between buyer and seller, these programs tend to give the benefit of the doubt to the buyer. That sometimes hurts the seller, but the buyer’s trust and goodwill is a big asset for the marketplaces. If it’s lost they might never get it back.

Buyers buy from marketplaces because they trust them, and that trust is well placed. The marketplaces have earned it and don’t take it for granted.

Loyalty

Buyer loyalty is where all the marketplaces’ advantages come together, powerfully.

Most of the time when I want to buy, I go to Amazon. Then I might try eBay. Or perhaps compare the two. Sometimes I’ll go to the website of one of the UK’s high-street retailers like Tesco or Argos. If all that fails, I’ll use Google, and I might arrive at an independent online store.

So finally I give the small online seller some attention! Actually, I’m only likely to have got this far because I was searching for the wrong thing at the larger sites. If I find the right product at an independent site, I’ll probably go back to Amazon and search for it there.

Am I an insanely loyal marketplace buyer to work so hard to avoid buying elsewhere? Is this rare? Unfortunately for the independent seller, it’s not. Even if you can get people to visit your online store, they often prefer to buy from another site they know and trust.

Why is that? Trust is probably the most important factor, but buyers who are loyal to the marketplaces also benefit from:

Not needing to register with the site.

The convenience and speed of saved address and payment details.

A consistent experience – they don’t need to learn how the site works.

Now “loyalty” is a strong word, conjuring up images of unbreakable, irrational devotion. But marketplace loyalty is entirely rational. Buying from eBay and Amazon again and again only increases trust, convenience and usability. Most sellers can’t break that loyalty with their own web store.

Buyers buy from marketplaces because they’ve bought from them before, and it’s in their best interests to buy from them again.

What’s Theirs Is Yours

I’ve spent some time explaining why the big marketplaces have almost all of the advantages when it comes to selling online. Most small web stores don’t stand a chance. It’s unfair.

Or is it? Yes, the marketplaces have it good, but you can sell there. I can’t think of any other industry where the dominant companies willingly open their doors to every other business who can keep to their standards. If you sell on the marketplaces, all their advantages are your advantages.

The marketplace seller doesn’t need to advertise, because the marketplaces do that for them.

They don’t need to work so hard to get the buyer’s trust, because the buyer already trusts the marketplace.

They don’t need to create an attractive and usable web store, because the buyer already knows how to buy on the marketplace – and likes doing it.

Marketplace sellers can concentrate on excelling in just those areas that they need to – product sourcing, fulfillment and customer service for example. Marketplace fees are for entry to the venue, marketing, and access to millions of buyers who come ready and willing to buy. Is there any other business where that’s possible?

When Web Stores Still Make Sense

A quick recap: most sellers with their own web store will struggle to create a compelling reason for buyers to buy from them, instead of marketplaces like eBay and Amazon. That’s most sellers, but not all of them.

What is so compelling that it can override buyers’ loyalty to marketplaces? There are several models that can, and do, work as independent web stores. But it’s not just a case of sourcing different product lines or writing a blog – these are completely different business models.

Under-served Product Categories

On eBay you can sell just about anything. There are some restrictions but most of those are items that would be immoral or illegal to sell anywhere. Amazon has more restrictive product categories, some of which (like auto parts) actually require sellers to have their own web stores (or at least hosted product images).

The potential to sell products that just aren’t allowed on the marketplaces is very limited, but there are some categories which marketplaces don’t do well. One example is fresh flowers. Both eBay and Amazon do actually sell flowers, but it feels a little odd to buy them there.

Bunches is one online florist that I don’t expect to be strongly threatened by the marketplaces.

Personalised Products

You can buy engraved or otherwise personalised products from the marketplaces, but they don’t fit cleanly into their shopping system. Amazon has even imposed limits on “novelty” items.

To buy personalised products on the marketplaces, buyers have to fill in a notes field or send an email after purchase. That can easily be forgotten or include mistakes, as there’s no automatic confirmation or preview of what the finished product will look like.

So personalised items are still a good fit for independent web stores. Trophy Store is one example of an online retailer in this area.

Your Own Unique Brand or Invention

Many marketplace sellers have unique products, created from white-label Chinese imports or combined “bundles” of other products. That may be enough to distinguish products from competitors on the marketplaces, but they aren’t really unique.

An online store can be successful selling genuine new brands. I think the best new brands target a niche of motivated enthusiasts – they’re not just another version of something that already exists. Good examples include Beardbrand and NatureBox.

Hobbies, Causes or Luxury Products

Some products just work best when sold on a dedicated site. These are the exceptions to the rule, that many buyers would actually expect to buy from an independent web store, and would feel out of place on a marketplace.

Here are some examples that I think fit that model:

The Origami Paper Shop. For the origami enthusiast, the specialism of this site is appealing in its own right – it marks them out as someone “in the know”. It’s backed up by the impressive range of paper available.

TOMS. This company sells shoes and eyewear on a buy-one, donate-one model: for every item sold, they give one away to a third-world charity. The message would be lost on a marketplace.

The Travelwrap Company. These are expensive cashmere wraps that would be devalued if sold on the marketplaces. The independent site helps convey that they are exclusive products from a specialist supplier.

In Closing

Selling on your own independent web store is not a simple extension of selling on marketplaces – it’s a completely different world.

It’s not just because you have to generate you own traffic, but also because buyers trust the marketplaces, enjoy buying from them, and will only go somewhere else if there’s a really compelling reason.

But the marketplaces offer many advantages over web stores, and the majority of sellers who sell commodity products should make the most of them.

Finally, successful online stores can still be built. But only by businesses with unique business models, or that sell under-served product categories, personalized products, their own brands or inventions, or appealing niche products.

I hope you’ve enjoyed this post and would love to hear your thoughts in the comments below!

Only selling on marketplaces?

Fees are up, standards are harsh and change is constant. Get control back with your own independent web store, or use automated tools to connect with millions of buyers on social media. All in the Web Retailer directory.

36 comments on “Why You Should Stop Hankering After Your Own Web Store”

I think that web stores don’t make sense for a lot of online retailers. However for retailers who are looking to grow beyond marketplaces sellers they are essential. eBay and Amazon are an enormous part of the ecommerce landscape, but they are only part of it. If a seller can develop a good website experience they can access sellers who are searching for products on platforms such as Google.

Being a marketplaces only seller also exposes the seller to the risk that they may be ejected from the marketplace and lose a significant proportion of their business. This is unlikely but possible. We have for example recently had our Amazon.it account suspended.

I agree it makes sense to diversify to protect your business, and there are some buyers that will go to Google first – but even then there’s a good chance they will end up back on a marketplace.

For those who do sell through their own stores, I think it’s important not to see it as just another channel. Marketplace sellers can do OK without having a particular niche or audience, but not so much on their own site.

To add on, there’s a massive fundamental aspect one must look at. When selling on the marketplaces of eBay and Amazon, it will be run along the lines of eBay’s and Amazon’s interests. Sometimes policy changes will not align with your own interests and you’ll be forced accomodate or lose your ability to sell.

If you’re a seller on Amazon, it is most wise to use the success in that marketplace to expand your business into other marketplaces and perhaps even major retailers. Tapping into a major retailers marketplace will not only provide you with a more specialized relationship with the marketplace owner but they’ll show interest in the sale of your merchandise since it has a bigger influence on them(unlike Amazon or eBay where it’s not always easy to speak with somebody with sway in the company to help make things easier for you and there is always a horde of sellers ready to take your place).

Even if you don’t think your own site can fit you while selling on Amazon, if you plan to expand, having a site at least with a core setup(say to serve as a database for product information and images) will come in handy because it’s highly likely you’ll evolve and expand to a point where it becomes more profitable to handle matters in-house than to rely on marketplaces.

I am so glad I read your article Andy. There is much pressure to have a web store with little thought of how to manage one – assuming you can get people to buy in the first place. I am a sole trader and haven’t the time to devote to two ‘shops’ or to co-ordinate stock between one and the other. I am now going to use my time to try and increase traffic to my eBay shop through email, and concentrate on doing one thing well instead of two things badly. I have bought a couple of Domains for possible future use, but I will wait until I have a unique selling point before I think about opening an independent shop.

Thanks Patricia! I think it’s always a good idea to do one thing well instead of two things badly – especially with online business people can get caught up with doing one different thing after another and never make the most of any of them.

Clearly there are risks for a business that only sells on eBay, it’s easy to see that. But I disagree with the inward-looking viewpoint I often see which says “I have to sell on my own site in case eBay bans me”. A much stronger business can be built if sellers find a way to genuinely say “I can serve my customers better by selling on my own site”.

We have a matching website for every eBay store and sell 8% more on the websites than eBay however… we buy a lot of traffic from Google, Bing and comparison shopping engines.

We do also spend a lot of time optimizing the sites and listings for SEO (search engine optimization) however over 90% of the converting traffic on the website comes from paid advertising.

I think many sellers feel eBay and Amazon fees are expensive and think having a website is a much cheaper method of getting sales however…. from our experience buying traffic is the only way to get a lot of traffic to a website.

Excellent points Neil. I look as the costs of the various marketplaces as customer acquisition expense. You are going to pay to acquire customers on the websites also. In fact, there fees provide a good estimate of what to budget when creating your own marketing plan.

I think there could be a lot of reasons for having an independent web store. However, I am going to stick with the most compelling reason, as well as the simplest to illustrate. The fact is, most people DO NOT shop on marketplaces. I did a quick search for 2012 numbers and a little quick math found the following:

This shows, even using rough numbers, that these major marketplaces are less than 25% (22.9%) of the total B to C revenue on the internet in 2012. Additionally, this number is probably very high since Amazon and Alibaba likely include lots of none B to C revenue (wholesale and cloud revenue) that I didn’t attempt to split out.

Those 75% are shopping other places, most likely specialty stores. I know personally that I shop on Amazon a lot, eBay some, but I buy a lot of other things from specialized retailers on the web for the depth of product they have. Most people are operating in the same way, as the numbers indicate.

Building and maintaining your website is not easy. As Neil pointed out, it is costly. However, taking the time to do it is a long term payoff. This is where the customers are.

I have my own webstore (3 in fact) but I still sell on ebay – I use ebay to get customers to come back and buy more from my webstores – I have a lot of repeat customers this way – who often come back and buy in bulk from my webstore. If a few years ago I sold mainly on ebay – now it is about 60% ebay and 40% my own stores – and the amount I sell on both has increased in total.

Absolute rubbish. There are millions of buyers who do not trust ebay, and less so but increasingly so, amazon because of the high number of scammers on those sites. It is difficult to find anybody from those who buy regularly on ebay who has purchased something and not been ripped off, although now ebay and Paypal have cleaned up their act a little it is sellers rather than buyers who are ripped off the most, particularly from false claims.

You stated yourself, “I hadn’t created a compelling reason for them to buy from me instead of someone else.” – so there’s your answer. Just because you didn’t doesn’t mean that nobody else can. There are millions – yes, millions – of independent websites out there that are flourishing. I know of one set up just six months ago that is now making it’s owner a regular four-figure monthly profit, and it’s nothing special, nothing particularly unusual, it has just been done the right way. notably he has not spent one penny on marketing it, but has spent a lot of time and effort learning how to market it.

I am in the process of doing exactly the same thing and although I am targeting a very competitive niche I am already getting thousands of visits and sales are starting to come in. As I continue to build it this will improve over time. It’s not easy, it takes time but it can be done and is being done by millions around the world. I

Ask yourself one simple question, would the internet really exist if it only existed of ebay, amazon and a handful of major players?

I’m not saying that independent stores can’t be successful, I’m saying that many marketplace sellers have businesses that won’t translate well to having their own store. For example, those selling commodities (as many do) like household batteries. I think an independent store needs something a bit special in terms of product, content or service — all three if possible!

Personally I’ve had bad buying experiences on eBay and independent web stores (but not Amazon, as far as I can remember). When a purchase goes wrong on an independent store, your only option is to complain to your credit card provider – an unpleasant process in my experience. But when it goes wrong on eBay or Amazon, it’s easy to get it resolved.

If you look only at the trust element, it’s more rational to buy from marketplaces as they offer a buying guarantee. From many people I talk to, that alone is enough to scare them away from indie stores. Google Trusted Stores is interesting, as it is an attempt to do something similar for independent stores.

I don’t disagree with any of that but the general theme of the thread, that you are wasting your time if you want to take on ebay/amazon et al is rubbish. There are ways of building and promoting your website and climbing up the rankings, as well as building trust. I know because I have done it. I just think it is wrong for people to get the impression that it isn’t possible.

Frankly there isn’t much you can sell on ebay and amazon that you could not sell on your own site, and in fact you are not subject to the same restrictions as the big boys place on you. For example, there is a guy lives a few miles for me who has made millions selling electronic cigarettes which are banned on ebay.

Another positive aspect for sellers of setting up your own website is that you are not subject to the restrictions placed on you by the marketplaces, e.g how many photos you can upload, what size they have to be, terms and conditions of sale and so on.

The bad thing about the marketplaces is they are good for buyers but for sellers they are shocking at times. It’s fairly common knowledge that if you file a claim on ebay you will get your money back. This applies to scammers too. It is impossible to sell low value items and make a worthwhile profit unless you are selling large numbers because on such items those extra fees make a lot of difference.

But the other, unseen issue is the ludicrous amount of “Item not received” (INR) claims you get. It is far too easy for scammers to claim, often under the threat of leaving negative feedback. I have sold on ebay, amazon and my websites and simply do not get those claims from website sales. The number of claims you get on ebay is shocking, it was 4% of sales at one point earlier this year. Furthermore many sellers will tell you that as a fee-paying customer both sites are absolutely appalling at “looking after their customers”. These are all good reasons why sellers should consider operating their own websites and done correctly you can use ebay and amazon to drive customers to your sites.

e-commerce via your own website is alive and kicking I assure you. Affiliate marketing is another angle too. I am a member of a site which even shows you how to set up and market your own site though I’m not going to add an affiliate link obviously. As for Google’s latest plan I think it’s just another attempt to get their share of the pie that gives ebay and amazon a lot of their traffic. Like those two, all Google really want is your money.

The message I’m trying to put across is: don’t build your own store because you are fed up with marketplace selling, build your own store because it allows you to serve buyers better. Many sellers are inward-looking and only think about the benefits for them. Buyers won’t buy from you because it’s better for you, only because it’s better for them.

By the way, in the article I do mention the potential to sell products that the marketplaces don’t allow, and you gave the example of electronic cigarettes. That’s a great example and the right kind of place to look for opportunities, I think.

In my opinion eBay and Amazon are fantastic at “looking after their customers”. But their customers, first and foremost, are the buyers. Looking at it another way, the marketplaces are just buying specific retail services — sourcing, fulfillment etc — from sellers. It’s more fitting for sellers to see themselves as suppliers to the marketplaces, rather than customers.

Yes, Google want your money. As do you, me, eBay, Amazon and every other business owner. In the example of Google Trusted Stores, they’re trying to get our money by providing a potentially useful service to both buyers and retailers. I’m not saying it’s a great service or destined to succeed. In all probability it will fail. But, I think they’ve identified something that’s needed — a way for independent sellers to show buyers that they can be trusted.

The way it came across to me is that in general you are advising that it is a waste of time trying to set up your own shop and compete with the model that is ebay and amazon. Which is why I said it was absolute rubbish.

It is actually well worth setting up your online shop to compliment an existing ebay and/or amazon account and those who have done so will tell you that many buyer actually prefer to buy direct from the buyer’s shop for repeat items (such as ink cartridges for example) rather than go back to ebay.

There are few products that sell on the marketplaces that you could not sell independently. In fact the high number of sellers of many products on those marketplaces has devalued a lot of items and it is possible to get far better prices on your own websites. Do a search for a product – any product – and you will often find ebay and amazon amongst the cheapest, but you will find many successful sellers selling the same items at much higher prices. My last site sold a lot less than I sold on ebay but at considerably better margins. The other bonus is there are no huge fees to worry about if your site isn’t as successful as you had hoped (it will be if you put the work in)

One seller I use for packaging is actually more expensive on his own site than he is on ebay, many others have similar prices and prefer to pocket the savings in fees (and why not?), and in fact Amazon have an (illegal) rule in the UK that forbids sellers selling their goods at a cheaper price anywhere else than they do on Amazon. It’s illegal because it’s price fixing but the reality is if you are found out Amazon will simply kick you off, secure in the knowledge that most independent sellers cannot afford to take legal action (one of a thousand such nuances I could tell you about the wonderful Amazon).

The marketplaces are good because they can offer a seller the exposure, but you can command better prices on your own site and a great many buyers are happy to use a site that offers any of the well known payment processors, including Paypal as they all offer their own levels of protection – you do not necessarily have to file a claim with your card issuer.

I think I am not even in the ring in this fight. As a reseller do you think I must get permission from my 8 suppliers to advertise their products from my webstore on any marketplace? And must I increase my webstore pricing to cover the charges exacted by the marketplaces when my webstore pricing is usually below my suppliers pricing in their websites?

Good one Andy. Although in the beginning I felt that this post is one-sided (marketplace favored only) I like how you bring in what to sell through an own online store.
And I agree, the marketplace has its own advantages and majority ones which we can’t deny. To anyone who wants to enter the world of eCommerce, I would definitely suggest getting a good experience on major marketplaces for initial 1-2 years. It teaches you a lot of things and it’s all worth it in spite of the transaction fees they charge. Imagine the whole brand building exercise that you can take off your plate and just concentrate on selling! It’s a blessing in disguise or by design.

Hi, I have been tasked with investigating an Amazon store for our product. We have an established company in an industry that we are a known entity. We do have our own webstore and we do pay for Google searches. We are just no satisfied with the business we do online at this time. We felt that opening an Amazon store would give us more visibility. I have looked into our product (from our competitors) on Amazon and have not found any competition. I feel that in my company’s situation we would clean up our own webstore instead of going with Amazon.

Do you have any advice for a manufacturing company that is know in our industry regarding an Amazon store?

Some manufacturers in your situation prefer to partner with a specialist consultancy that will help you launch your product assortment on Amazon.

My company, Bobsled Marketing, offers such a ‘done-for-you’ service. We’ve worked with manufacturers, inventors, and everything in between to painlessly launch their product on Amazon and start generating significant revenue within just a few weeks.

Thank you for this article. I just started a business selling costumes and really struggled with deciding which was a better route: personal website vs. amazon & ebay. I’m very limited in funding, and want to spend my investment wisely.
Even though these marketplaces charge a fee when your item is sold, I think this cost outweighs having to dump money into a website monthly without generating consistent income..at least in the early stages. Perhaps if sales increases, then considering a website would be a good alternative.

LOL Given example with paper advertising is not related to these days AT ALL. People now buy much much more online, you can setup facbook account (free), advertise on Youtube (free) and much more. But if you know how to use PAID ADVERTISING (Most people don’t) you can start running IMMEDIATELY 50 000 – 20 000K monthly turnover on almost any item that you can find. You can run 20 000K monthly only with check Chinese bracelets so please don’t tell me that have your own website is bad and it doesn’t worth. IT DOES! The only downside is traffic if you don’t know how to generate it but everything else is better then eBay or Amazon.

An excellent article but nowhere do I see what is actually a major point here. That is that the marketplaces, like Amazon in our case, actually own the customer. SO one’s efforts to build a really valuable business are severely restricted. Repeat customers are a major factor in any “valuation event” i.e. obtaining an outside investment or selling or merging the company etc. etc. If marketplace revenue is a major part of your business it’s really only a lifestyle business at best. It’s definitely tough to build one’s own website but if you’re serious about making money I don’t see any alternative.

Well I’ve just been banned from Ebay and my whole business was ran through it. No warning, just straight kicked off overnight. So let that be a lesson to anybody operating a marketplace only business.

Now you might think that I’ve done something really bad, but in the real world what I have done is trivial. Ebay don’t allow you more than 0.3% of your sales to have cases closed by Ebay. This is for items not received, items not as described etc. If a customer contacts you and says that they haven’t received their item, you then tell them to check their local sorting office and check with their neighbours and get back to you. The problem is that if they don’t get back to you and instead contact Ebay then Ebay just refunds the customer automatically and closes the case in the buyers favour, this then counts to that 0.3%. In short they open the case and close it without giving you the chance to sort it out, case open, case closed without you knowing there was a case in the first place.

This happened to me 3 times in around the last 1,300 sales, but one customer had purchased two items in separate transactions so that one was classed as two. In a nutshell I was shut-down because my cases closed without a seller resulution rate was above 0.3%, do you know what it was? It was 0.33%. So I was 0.03% out of their rule and shut down and never allowed to sell on Ebay again. Everything else was completely fine, my returns rate was less than 1%, my feedback was 98.3% in a sector that is difficult to maintain perfect 100% feedback and the feedback comments were excellent with many saying that they would shop again with myself.

You have all been warned, do not build a worthwhile business on the marketplaces. For these reasons:

1. You can be shut down over night. No reasoning, just shut down. That means you lose your income and have a load of stock on your hands and still the costs of storage but without a way to sell it.

2. The business has no value. You cannot walk away after building up the business and sell it. If you build your own website then you can retire and sell it to somebody else, so your hard work has got value, even if the website doesn’t make any money it usually has some sort of value. A marketplace only business has no value what-so-ever, you cannot sell an Ebay or Amazon business.

3. You end up living in fear of being shut down. I know it sounds daft but I am relieved that Ebay has shut me down. Everyday checking for bad feedback and wondering if someone is going to complain to Ebay is very stressful but you don’t realise it until you don’t have that worry any more. With your own website you don’t have to worry about anything like that. You can have a customer rant and rave on at you about the most stupid of things but you don’t have to worry that they will have a detrimental effect on your business, their complaints don’t show on your website so no other customers see any unfair negative comments, nobody can shut your website down because of that one customer.

4. The marketplaces are all about being the cheapest. There is no other factor to the buyers behaviour, in general you have to be within 10% of the cheapest price or else you don’t get a look in. This means you end up working for peanuts, often below the minimum wage. On your own website you have full control over the branding and can charge a lot more than the marketplaces because you look a lot more professional and like a proper business rather than a one man band selling from a spare room in their house. Ebay buyers seem to think that you are a volunteer selling not for profit.

So don’t sell on the marketplaces unless you are just doing it for a bit of pin money and already have a full time job. If you haven’t got a full time job then it’s business suicide to just rely on the marketplaces.

Also don’t kid yourself that you are ‘testing the market’ before opening a website. What works on Ebay doesn’t mean it will work on your own website. So it’s a pointless exercise. You don’t even need to sell on Ebay to see what sells. Just open an account with Terapeak and that will tell you everything you want to know regarding the market share and the best sellers The only thing you should use Ebay for is to shift dead stock at a loss or as a bit of pin money on the side.

The ultimate problem with Amazon is that it seeks to reduce all product to commodity status.

Unless you are a big player, you can’t compete on a commodity basis…that is, on price.

MOST products are not truly customized. In other words, most items are mass produced and if you are seeking income by reselling them, there is no way to effectively differentiate them on Amazon…from the guy in the booth next to you.

This is the real problem with the marketplace. There is nothing in it for most sellers. That is, unless you are willing to take a very big risk buying product or entering into contracts, only to be responsible for returns and making 1-2% per sale.

Don’t forget Jeff Bezos has said repeatedly he is always looking to reduce cost to the buyer. Someone pays for that…and you guessed it…it is you and I providing products in the marketplace.

Take a look at the reward / punishment system for ebooks. It is very revealing. In essence, if you post a reasonable price for your wares ($15.99)…you get much less margin. It isn’t to reward Amazon with a bigger check, it is to prevent you from charging much more than $4.99.